]]>J. Mack Swigert remembers hunting for work in Chicago during the height of the Great Depression. Even his Harvard Law degree was no guarantee. “I had to hustle it by walking up and down LaSalle Street.”

Swigert, now 102, was pleased to be offered a $15-a-week job at a time when “there were men selling apples on the street corner.” His father, on the other hand, saw his own business falter in the harsh economic times, and ultimately went bankrupt.

It all has a familiar ring. What Swigert remembers from the ’30s echoes what millions of Americans are experiencing now. The economy has lost more than 8 million jobs since the recession began in December 2007. As of March this year, the unemployment rate stood at 9.7 percent for the third consecutive month, edging up to 9.9 percent in April, according to the Bureau of Labor Statistics. Although there are signs the recession is lessening, a record 6.7 million Americans have been out of work for 27 weeks or longer.

The comparisons between the ’30s and today are both painful and inevitable, but it’s pretty obvious this hasn’t been our fathers’ (or grandfathers’) depression. No economist has suggested our predicament is anything close to what occurred in the 1930s, when the market collapsed and 15 million people, one-fourth of the work force, were unemployed.

Nor has the current crisis led to as much imagery associated with the Great Depression: bread lines, shantytowns, homeless men—called tramps then—wandering door to door in search of handouts and charity.

A scene common in american cities during the 1930s, skilled and unskilled laborers alike stood in bread lines like this one near the Brooklyn Bridge in New York City.Photo courtesy of the Library of Congress.

One reason, of course, is the New Deal itself. The Social Security Act of 1935 created, in addition to the retirement insurance for which it’s named, a federal and state system of unemployment compensation that provides temporary, partial wages to the newly out-of-work. It’s a cushion for families, and it helps stabilize the economy during recessions.

The safety net devised under Roosevelt protects the country today “from looking like it did in 1931 and 1932,” says Nick Taylor, whose book, American-Made: The Enduring Legacy of the WPA, analyzes the economic crisis that began under Herbert Hoover, brought FDR into office, and prompted creation of the Works Progress Administration (WPA), among other economic reforms.

Perhaps more significant, the New Deal forever changed the public’s expectation of the government’s role in times of hardship. The pre-World War II generation hit bottom before government stepped in. Republican Herbert Hoover, who prematurely declared “The Depression is over” in June 1930, steadfastly opposed government action, which led to his lopsided loss to FDR. In 2008 presidential candidates Obama and McCain stood together against laissez faire banking; to have done otherwise could have been political suicide.

“The Roosevelt administration was the first one to recognize that the government was responsible for the welfare of the people,” Taylor says. “One of government’s purposes is to have a humanitarian side.”

Roosevelt’s program was controversial then. It still is igniting debate that rages among pundits and economists. Did the New Deal help end the Great Depression, or was it just a distraction until World War II provided the real economic stimulus?

Wake Forest University economist Robert Whaples conducted a survey of economists in 1995 and asked if they agreed with the following: “Taken as a whole, government policies of the New Deal served to lengthen and deepen the Great Depression.” Fifty-one percent disagreed and 49 percent agreed (many with provisions).

The most glowing analyses credit the New Deal for lifting the country out of the worst of the Depression and improving the mood of a panicked nation. The most critical suggest that Roosevelt’s fiscal policies not only aggravated the crisis but extended the Depression by as many as seven years. But on one aspect of the New Deal, its humanitarian impact on suffering individuals, almost everyone agrees: Government-sponsored jobs improved the economic circumstances of the people who held those jobs.

Roosevelt first proposed the idea of a permanent jobs program during his annual message to Congress on January 4, 1935. A variety of temporary relief measures had been implemented by then, but Roosevelt considered them handouts and demeaning to human dignity. At that time, 5 million people were receiving some form of government aid, 3.5 million of whom Roosevelt felt were able-bodied and could be working.

The WPA renewed America's infrastructure, building roads, bridges, airports, and water and sewer systems, among other improvements.Photos: Library of Congress

His proposal became the Works Progress Administration. At its peak in March 1938, the WPA rolls hit 3.4 million. By June 1943, when the program was ended because it was no longer needed—unemployment had fallen to 1.9 percent—the WPA had employed more than 8.5 million people on 1.4 million different projects.

After that, Taylor writes, “No one would care to look at the WPA again for quite some time. In the heat of war, there was too much else to think about, and the agency closed its doors without fanfare. Two years later, when the war was ending and life slowly began to return to normal, Americans did not want to remember the Depression.”

Its legacy, Taylor says, is measured in statistics and still evident all around us. The WPA fought floods, hurricanes, and fires; recycled toys; inoculated the sick; and “created works that even without restoration have lasted for more than 70 years.”

President Barack Obama consistently invoked the New Deal as historic evidence to support his stimulus plan. “With the private sector so weakened by this recession, the federal government is the only entity left with the resources to jolt our economy back into life. It is only government that can break the vicious cycle where lost jobs lead to people spending less money, which leads to even more layoffs,” he said.

The WPA produced unforgettable posters from 1936 to 1943 by drawing on the talents of hundreds of out-of-work artists. The posters were designed to promote health and hygiene, cultural activities, domestic travel, community involvement, and educational programs.Poster courtesy of the Library of Congress

Many similarities can be found between the New Deal and the American Recovery and Reinvestment Act (ARRA) of 2009. The most obvious is that both were designed to save or create about 3.5 million jobs.

Yet Roosevelt himself could not have imagined the size of the government’s commitment this time around. The Works Progress Administration, massive as it was, spent $11 billion during its eight-year tenure. Adjusted for inflation, that would be more than $130 billion today. That pales in comparison to the $787 billion in the stimulus package, which has gone to tax cuts; extended unemployment benefits; and government spending on education, health care, weatherization, and infrastructure. That was all on top of the $700 billion financial services bailout passed by Congress earlier.

The enormity of the investment may be what most distinguishes ARRA from the New Deal. Quoted in a report by Voice of America, historian Alan Brinkley of Columbia University suggested that the weakness of the New Deal was that it wasn’t big enough to compensate for the loss of wealth of the Great Depression. “If you want to counteract a severe recession, you have to take big measures to generate economic activity. And I think that is what the stimulus package is designed to do,” he said.

In April, President Obama said the stimulus bill has succeeded and can be credited with helping business bounce back. Economic research firms Macroeconomic Advisers, IHS Global Insight, and Moody’s Economy.com estimate that the bill has added 1.6 million to 1.8 million jobs to the economy so far.

Without question, opportunities for waste and corruption have occurred just as they did during the ’30s, when “stories were legion about people leaning on shovels,” Taylor says. Indeed, the government agency charged with keeping track of expenditures and job creation has found the task next to impossible, releasing data that indicates stimulus money has been distributed to 440 congressional districts that don’t even exist: the “phantom zip code scandal.”

The stimulus act also has piled debt on taxpayers that may not get paid off for decades. That’s a concern for many, including J. Mack Swigert, the pavement-pounding Harvard graduate who eventually became a labor and litigation attorney. “I don’t know whether a stimulus package is good or not,” Swigert says. “On the one hand, it puts us further in debt. On the other hand, it keeps businesses going and people at work.”

That’s a sentiment he’s held ever since the Depression and experienced the relief that came from getting any kind of job, even a $15-a-week one. “My feeling then was if you had a job, you ought to be happy. And I was.” And that’s good advice for every generation, not just in times of want, but times of plenty.

]]>http://www.saturdayeveningpost.com/2010/07/26/in-the-magazine/trends-and-opinions/putting-america-work.html/feed0Retirement Age: 65 and Risinghttp://www.saturdayeveningpost.com/2009/03/01/in-the-magazine/trends-and-opinions/retirement-age-65-rising.html
http://www.saturdayeveningpost.com/2009/03/01/in-the-magazine/trends-and-opinions/retirement-age-65-rising.html#commentsWed, 30 Nov -0001 00:00:00 +0000http://72.3.135.59/wordpress/?p=882Retirement isn’t what it used to be, as growing numbers of retirees are returning to the work force—by choice or by necessity. Kelly White has done a lot in his 70 years, from operating a bulldozer to running his own construction company. He’s worked in military intelligence, owned an apple orchard, and invested in the […]

]]>Retirement isn’t what it used to be, as growing numbers of retirees are returning to the work force—by choice or by necessity.

Kelly White has done a lot in his 70 years, from operating a bulldozer to running his own construction company. He’s worked in military intelligence, owned an apple orchard, and invested in the stock market. By almost anyone’s standard, he’s earned the right to slow down.

But the times, they are a changin’. Like many of his peers who have hit retirement age, White is working as hard as ever, “probably harder than I did in my 30s,” he says. These days you’ll find him crunching numbers and serving customers at the HoneyBaked Ham store in Silverdale, Washington, where he and his wife, Sue, put in close to 50 hours per week —apiece.

The Whites tried retirement and didn’t take to it. “We just got bored. We also lost a fair amount of money in the stock market spiral.” So they launched a new career as owners of a popular food franchise.

Ironically, the downturn to which White referred was the dot-com collapse of 2000 and 2001. That seems like small potatoes compared to the 2008 market collapse, which has made work a virtual necessity for many people 65 and older. Other key factors—Congress’s decision to raise retirement age, the escalating cost of health care, and an aging populace—have contributed to the new economic reality: Retirement age just isn’t what it used to be.

Retirement security “is being eroded from a number of sides,” according to a joint study by the Economic Policy Institute and the Center for American Progress. “The decimation of retirement savings due to a sharp stock market decline, historically low interest rates, and in some cases, corporate fraud, has reduced household savings. In addition to these factors, retirement income security has also been undermined by rising health care costs.” The U.S. Department of Labor confirmed the trend in a recent report. “With the baby-boom generation about to start joining the ranks of those age 65 and over, the graying of the American work force is only just beginning,” it said.

Roughly 6.1 million people age 65 or older are in the work force today, compared to 3.8 million 10 years ago. No other age group has seen such huge jumps in employment in recent decades. Between 1977 and 2007, employment of workers 65 and over increased 101 percent, compared to a 59 percent increase for total employment, according to the Bureau of Labor Statistics. The number of employed men 65 and over rose 78 percent; employment of women 65 and older increased by 147 percent. Although they’re still less than 1 percent of the total labor force, the number of working folks 75 and older jumped a whopping 172 percent.

In the latest AARP survey on the subject, 70 percent of “mature workers,” those between 50 and 70, said they’ll keep working through their 60s and 70s. Sixty-four percent of those working now cited financial need as the reason. Another 11 percent mentioned financial security and the desire “to save more for retirement.” Keeping health care benefits was another commonly stated reason.

Even with Social Security and pension benefits, many older people simply haven’t saved enough to retire. And some who thought they had enough watched the worth of their 401Ks and other nest eggs plummet by 30, 40, or even 50 percent this past fall.

“A lot of the value of my assets is declining precipitously,” says Tina Beer, 67, of Sarasota, Florida, who retired at 65 after 35 years in higher education, most recently serving as dean of liberal arts at the Ringling College of Art and Design.

A year ago, Beer went back to work. This time she chose a part-time and virtually stress-free position that allows her to be outdoors much of the time, which makes it fun. As a pet sitter and dog walker for Fetch! Pet Care, she can earn from a few hundred to almost $1,000 per month. The extra income helps Beer and her 73-year-old husband afford travel, entertainment, and the extras they couldn’t otherwise enjoy. Plus the job is flexible: If she and her husband want to go sailing for a couple weeks, she just notifies her employer, and he finds someone else to take her jobs.

Although Beer could have started her own pet sitting business, she affiliated with a franchise so she wouldn’t have to worry about filling out paperwork, finding clients, collecting money, or other details of owning a business. Beer’s only concern is not to earn too much. Social Security benefits become taxable once the total of adjusted gross income, tax-exempt interest income, and one-half of Social Security benefits exceeds $25,000 for individuals or $32,000 for couples.

Unfortunately, folks wanting to retire early or work past retirement age have to keep track of such things to avoid running afoul of Social Security and pension rules that can end up costing them.

Historically, 65 has been considered normal retirement age because it’s when people can claim full Social Security benefits. In 1983, Congress voted to gradually raise the full retirement age beginning with people born in 1938 or later. For anyone born after 1959, full retirement age is 67. Congress based its decision on the improved health of older people and increases in average life expectancy.

People can still start receiving Social Security benefits at 62, but there are reasons not to. If you’re under full retirement age when you start drawing benefits, you’ll lose $1 in benefits for every $2 you earn above the annual limit. For 2009 that limit is $14,160.

If anything, the trend now is to delay claiming benefits as long as possible, which is currently age 70. People who keep working will be rewarded in the form of a delayed retirement credit: A person born in 1943 or later gets an 8 percent higher check for postponing retirement until they are 70. Also, Social Security benefits are based on your top 35 earning years, so those who work past the normal retirement age and continue to make good money can ensure a bigger monthly check.

There are some obstacles, however, for those who want to stay in their current jobs, especially if their employers are among the minority still offering defined benefit pension plans. Under the terms of many of these plans, companies cannot make both salary and pension payments to the same worker at the same time. In addition, some pension plans base their payouts on an employee’s salary during the last year of full-time employment. A worker who stays with his current employer but downsizes his job and accepts reduced salary could actually lose money if the distribution is based on the lower salary amount.

Fortune 500 companies such as Boeing, Eli Lilly, and P&G have found ways around such predicaments. They still use senior, retired workers, but they find and retain them in nontraditional ways, explains Linda Muskin of Clarus Communications. For example, some firms contract with YourEncore (yourencore.com), which has a database of more than 4,000 retired engineers and scientists interested in working on projects in which they can make a meaningful contribution, have a flexible schedule, and get paid for their expertise.

Companies and retirees are less likely to butt heads with Employee Retirement Income Security Act (ERISA) laws governing postretirement compensation when they work through a third party, Muskin said. The Employee Retirement Income Security Act of 1974 is a federal law that sets minimum standards for most voluntarily established pension and health plans in private industry. Although the purpose of the law is to provide protection for individuals in these plans, some of its rules actually discourage postretirement employment.

Sen. Herb Kohl, (D-Wis.), who chairs the Senate Special Committee on Aging, has introduced legislation to eliminate these kinds of barriers for older Americans who want to stay in the work force longer and to encourage employers to recruit and retain older workers. The Incentives for Older Workers Act (S. 2933) addresses both the pension and Social Security dilemmas. It would prohibit pension plans from penalizing individuals for continuing to work on a reduced schedule, and it would revise the Social Security benefit reduction to $1 for every $3 earned before full retirement age. The bill also would allow individuals to earn delayed retirement credits for Social Security purposes for an additional two years until age 72, instead of the current limit of 70.

Bottom line: Retiring at 65 is no longer a realistic American dream for workers or corporate America. Public policy needs to change to reflect that fact.

If you’re 65 and fairly healthy, chances are good you’ll live another 20 to 25 years. To retire at the level recommended by financial planners, you’d need about 75 percent of what you were earning when fully employed, multiplied by the number of years you’re expected to live. As an example, someone making $100,000 would want to have at least $1.5 million in the bank. Such savers are the exception, not the rule.

Fortunately for seniors, the need to work longer coincides with a looming labor shortage forecast for many sectors of the economy as baby boomers age out of the work force. Economists say the spike in unemployment that occurred in 2008 is temporary. According to the Special Committee on Aging, the U.S. labor pool will face a shortage of up to 35 million workers by 2030. Fields already reporting shortages include health care, technology, social services, education, public utilities, and engineering.

A multitude of nonprofit and commercial ventures have sprung up to connect seniors with employment and service opportunities. SeniorJobBank (seniorjobbank.org ) is an online service aimed at the over-50 community where job seekers can search job listings and employers can post openings. The AARP Foundation offers two programs to help qualifying seniors find meaningful, well-paying jobs. The Senior Community Service Employment Program targets those 55 and older who are unemployed and need to work to survive. Seniors are placed at “host agencies” such as food banks and hospitals, where they work 20 hours a week and receive at least minimum wage. The jobs are considered temporary while the seniors hone their skills and the program helps locate permanent part-time or full-time work. Another AARP program, WorkSearch, provides career placement advice and the training seniors need to remain in or re-enter the work force.

For those who want to continue to feel useful but don’t necessarily need the money, a campaign called The Experience Wave (experiencewave.org ) is working to change federal tax law to permit older people to treat the time they spend volunteering for nonprofit groups as tax deductible. There’s an irony, of course, to this latest trend of seniors working past 65. One of the great achievements of the 20th century was making retirement a viable option for so many. The allure of travel, spending time with grandchildren, and enjoying a well-deserved rest had become the Holy Grail of the aging process. Here we are now, just a few years into the 21st century, and the goal is to make it easier for seniors to remain or return to work.

The best of both worlds, of course, would be one in which the laws were flexible enough that seniors could jump in and out of the labor force as it suits their needs, and employers could recruit older workers without anyone assuming additional financial risk.

Henry Ford once said, “Nobody can think straight who does not work. Idleness warps the mind.” It’s a sentiment with which Tina Beer and Kelly White and many of their peers fully agree. Over one-third of White’s fellow HoneyBaked Ham franchisees are “retired” workers.

“What I like about my job,” Beer says, “is it’s outdoors most of the time and, to me, that’s play. I get to play with adorable dogs and cats and supplement my income.”

“Unless you’re really active, you do begin a process of mental deterioration as you age,” White says. “Working keeps us young.” And that’s the silver lining to the new economic reality.